IN A STUDY OF RELATIONSHIPS BETWEEN FINANCIAL INPUT AND SELECTED OUTPUT MEASURES, WITH STATISTICAL CONTROL FOR VARIATIONS IN COMMUNITY CHARACTERISTICS, 15 PUBLIC CALIFORNIA JUNIOR COLLEGES WERE STUDIED WITH RESPECT TO THREE FINANCIAL VARIABLES (INSTRUCTIONAL EXPENDITURES PER AVERAGE DAILY ATTENDANCE (ADA) UNIT, TOTAL CURRENT EXPENSE PER ADA, AND NONINSTRUCTIONAL EXPENSES PER ADA) AND SEVEN OUTPUT MEASURES--(1) PERCENT OF VOCATIONAL STUDENTS COMPLETING PROGRAM OR SECURING RELEVANT EMPLOYMENT, (2) PERCENT OF ENROLLMENT RECEIVING AN AA DEGREE, (3) PERCENT OF ENROLLMENT TRANSFERRING TO SENIOR INSTITUTIONS, (4) PERCENT OF ENROLLMENT PLACED ON PROBATION, (5) PERCENT OF ENROLLMENT DISMISSED, (6) PERCENT OF ENROLLMENT COMPLETING BACHELOR'S DEGREE, AND (7) PERCENT OF PROBATION PLUS DISMISSAL. IT WAS FOUND THAT APPROXIMATELY HALF OF THE VARIATION IN THE OUTPUT MEASURES AND NEARLY ALL OF THE VARIATION IN FINANCIAL INPUT COULD BE EXPLAINED BY DIFFERENCES IN COMMUNITY CHARACTERISTICS. COMMUNITY DIFFERENCES SEEMED MOST EFFECTIVE IN THE DETERMINATION OF THE PERCENT OF TRANSFER STUDENTS (85 PERCENT OF THE VARIANCE) AND LESS EFFECTIVE (ABOUT ONE-THIRD OF THE VARIANCE) IN DETERMINING PERCENT OF STUDENTS EARNING AA DEGREE, EARNING BA DEGREES, AND BEING PLACED ON PROBATION. (WO)